Investment Rating - The report maintains a "Buy" rating for the company [1] Core Insights - The company's 2024 revenue is projected to be 1.933 billion RMB, representing a year-on-year growth of 25.5%. The gross profit is expected to reach 1.274 billion RMB, with a significant increase of 67.8% year-on-year. The adjusted annual loss is anticipated to narrow by 73.7% to 118 million RMB, indicating improved operational efficiency [7] - Multiple products are set to commercialize this year, which is expected to lead to rapid revenue growth. Key products include SKB264, A166, A167, and A140, with approvals anticipated to enhance profitability significantly [7] - The company has a strong cash reserve of over 3.076 billion RMB, reflecting a year-on-year growth of 21.6%, which supports its ongoing research and development efforts [7] Financial Summary - Total revenue for 2023 is reported at 1.54 billion RMB, with a projected increase to 1.933 billion RMB in 2024, followed by a decline to 1.783 billion RMB in 2025, and then a substantial rise to 3.559 billion RMB in 2026 and 5.894 billion RMB in 2027 [1][8] - The net profit attributable to the parent company is expected to improve from a loss of 574.13 million RMB in 2023 to a loss of 266.77 million RMB in 2024, with a forecasted profit of 444.17 million RMB by 2027 [1][8] - The earnings per share (EPS) is projected to improve from -2.53 RMB in 2023 to -1.17 RMB in 2024, and is expected to turn positive at 1.95 RMB by 2027 [1][8] Product Development and Market Position - SKB264, a TROP2 ADC, has received approval for multiple indications in China, with further clinical trials ongoing both domestically and internationally. This positions the company favorably in the competitive landscape [7] - The company is actively pursuing market opportunities for its innovative products, with several key approvals expected to drive future revenue growth [7]

Investment Rating - The report maintains a "Buy" rating for the company [1] Core Insights - The company's 2024 revenue is projected to be 1.933 billion RMB, representing a year-on-year growth of 25.5%. The gross profit is expected to reach 1.274 billion RMB, with a significant increase of 67.8% year-on-year. The adjusted annual loss is anticipated to narrow by 73.7% to 118 million RMB, indicating improved operational efficiency [7] - Multiple products are set to commercialize this year, which is expected to lead to rapid revenue growth. Key products include SKB264, A166, A167, and A140, with approvals anticipated to enhance profitability significantly [7] - The company has a strong cash reserve of over 3.076 billion RMB, reflecting a year-on-year growth of 21.6%, which supports its ongoing research and development efforts [7] Financial Summary - Total revenue projections for 2024, 2025, 2026, and 2027 are 1.933 billion RMB, 1.783 billion RMB, 3.559 billion RMB, and 5.894 billion RMB respectively, with growth rates of 25.5%, -7.76%, 99.61%, and 65.61% [1][8] - The net profit attributable to the parent company is forecasted to be -266.77 million RMB in 2024, -604.96 million RMB in 2025, -216.79 million RMB in 2026, and a positive 444.17 million RMB in 2027, indicating a turnaround in profitability [1][8] - The earnings per share (EPS) are projected to be -1.17 RMB in 2024, -2.66 RMB in 2025, -0.95 RMB in 2026, and 1.95 RMB in 2027, reflecting a potential recovery in earnings [1][8]

Financial Performance - The company's revenue for the year ended December 31, 2024, was RMB 1,933,045,000, representing a 25.5% increase from RMB 1,540,493,000 in 2023[4] - Gross profit for the same period was RMB 1,273,657,000, a significant increase of 67.8% compared to RMB 759,185,000 in 2023[4] - The annual loss decreased to RMB 266,766,000, a 53.5% improvement from a loss of RMB 574,134,000 in 2023[4] - Adjusted annual loss was RMB 118,481,000, down 73.7% from RMB 450,788,000 in the prior year[4] - Cash and financial assets increased to RMB 3,075,651,000, a 21.6% rise from RMB 2,528,342,000 in 2023[4] - Total equity grew to RMB 3,308,661,000, marking a 42.0% increase from RMB 2,329,497,000 in the previous year[4] - The company reported a significant reduction in operating loss to RMB 138,749 thousand in 2024 from RMB 383,383 thousand in 2023, reflecting improved operational efficiency[31] - The company reported a net loss attributable to ordinary shareholders of RMB (266,766) thousand for 2024, a significant improvement compared to a loss of RMB (574,134) thousand in 2023[55] - The company achieved significant milestones in research and development, contributing to the overall revenue growth and the commencement of drug sales in 2024[140] Research and Development - Research and development expenses rose to RMB 1,206,134,000, reflecting a 17.0% increase from RMB 1,030,966,000 in the previous year[4] - The company has 11 ADC and novel conjugate drug assets in clinical or above stages, including sac-TMT and another drug for HER2+ breast cancer that has reached NDA stage[7] - The company presented clinical data for sac-TMT at various academic conferences, including a Phase 3 study (OptiTROP-Breast01) for previously treated locally advanced or metastatic TNBC[12] - The exploratory analysis of sac-TMT in previously treated advanced TNBC patients showed significant results in the Phase 3 study[12] - The company is actively exploring sac-TMT for other solid tumors, including GC, EC, CC, OC, UC, CRPC, and HNSCC[82] - The company is conducting multiple global Phase 2 basket trials for sac-TMT as a monotherapy or in combination with other treatments for various solid tumors[125] - The company has established three core platforms focusing on ADC, macromolecule, and small molecule technologies for drug discovery and development[116] Product Approvals and Clinical Trials - The core product sac-TMT received approval from the National Medical Products Administration in November 2024 for treating adult patients with unresectable locally advanced or metastatic TNBC[6] - The NDA for the core product, A166 (HER2 ADC), was accepted by the National Medical Products Administration in January 2025, showing significant improvement in progression-free survival (PFS) compared to T-DM1[13] - Tagolizumab is the first PD-L1 monoclonal antibody approved for first-line treatment of NPC in January 2025[16] - The company received IND approval for SKB500 and SKB501 for treating advanced solid tumors in November and December 2024, respectively[16] - The NDA for sac-TMT was accepted by the NMPA in October 2024, with priority review for treating EGFR mutation-positive NSCLC patients who progressed after EGFR-TKI therapy[81] - The NDA for the HER2 ADC, A166, was accepted by the NMPA in May 2023, targeting advanced HER2+ solid tumors[87] Collaborations and Partnerships - The company has established a commercial team to implement marketing strategies for strategic products, focusing on areas with medical needs in China such as BC and NSCLC[21] - The collaboration with Merck involves the development of multiple ADC assets, with 12 ongoing global Phase 3 studies for sac-TMT in various cancer types[23] - The company has entered into a licensing and collaboration agreement with Merck to develop multiple ADC assets for cancer treatment, retaining rights for development and commercialization in Greater China[124] - The company is exploring strategic investment and acquisition opportunities to promote long-term development, with further announcements to be made as opportunities mature[181] Market and Commercialization - The company has initiated commercialization of sac-TMT and other monoclonal antibodies, with plans to launch additional products in the Chinese market by 2025[132] - The company aims to optimize patient treatment outcomes by prioritizing commercialization strategies in therapeutic areas with medical needs, such as BC, NSCLC, and GI cancers[132] - The company has received a total of $147.5 million in upfront and milestone payments from various collaboration pipelines as of 2024[129] Governance and Sustainability - The company has established a comprehensive three-tier ESG governance structure, enhancing its ESG accountability and sustainability efforts, and received the "Outstanding ESG Governance Performance Award" in June 2024[30] - The company has established a comprehensive ESG governance framework to enhance its sustainability efforts and received the "Outstanding ESG Governance Performance Award" in June 2024[136] - As of December 31, 2024, the company strictly adhered to corporate governance codes and will continue to review its governance practices[196]

Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - The company has received approval for the first Trop2 ADC lung cancer indication globally, which aligns with previous expectations [7] - The expansion of indications is favorable for commercialization in China, with the company expected to participate in the 2025 national medical insurance negotiations [7] - The potential of the product is gradually being realized, with ongoing global phase III studies for additional lung cancer indications [7] - 2025 is projected to be a pivotal year for the company's product commercialization, with several products expected to be approved [7] Financial Summary - Revenue projections for the company are as follows: - 2023A: 1,540.5 million RMB - 2024E: 1,746.8 million RMB (growth rate: 13.4%) - 2025E: 1,836.7 million RMB (growth rate: 5.2%) - 2026E: 2,877.2 million RMB (growth rate: 56.7%) [2] - The net profit attributable to the parent company is projected to be negative, with figures as follows: - 2023A: -574.1 million RMB - 2024E: -350.1 million RMB - 2025E: -434.6 million RMB - 2026E: -286.1 million RMB [2] - Earnings per share (EPS) is expected to improve from -2.53 in 2023A to -1.26 in 2026E [2] - The company anticipates significant revenue from the product Lukanosatuzumab, with projected sales of 47 million RMB in 2024, 960 million RMB in 2025, and 1,886 million RMB in 2026 [9]

Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - The company has received approval for the first global Trop2 ADC lung cancer indication, which aligns with previous expectations [7] - The expansion of indications is favorable for commercialization in China, with the company expected to participate in the 2025 national medical insurance negotiations [7] - The potential of the product is gradually being realized, with ongoing global phase III studies for additional lung cancer indications [7] - 2025 is projected to be a pivotal year for the company's product commercialization, with several products expected to be approved [7] Financial Summary - Revenue projections for the company are as follows: - 2023A: 1,540.5 million RMB - 2024E: 1,746.8 million RMB (growth rate: 13.4%) - 2025E: 1,836.7 million RMB (growth rate: 5.2%) - 2026E: 2,877.2 million RMB (growth rate: 56.7%) [2] - The net profit attributable to the parent company is projected to be negative, with figures as follows: - 2023A: -574.1 million RMB - 2024E: -350.1 million RMB - 2025E: -434.6 million RMB - 2026E: -286.1 million RMB [2] - Earnings per share (EPS) is expected to improve from -2.53 in 2023A to -1.26 in 2026E [2] - The company anticipates significant revenue from the product Lukanosatuzumab, with projected sales of 47 million RMB in 2024, 960 million RMB in 2025, and 1,886 million RMB in 2026 [9] Key Assumptions - The company is expected to receive collaboration payments from Merck, totaling approximately 1.7 billion RMB from 2024 to 2026 [8] - The approval of Lukanosatuzumab in November 2024 is anticipated to generate substantial revenue in the following years [8]

Investment Rating - The report maintains a "Buy" rating for the company [3][11]. Core Insights - The company has received multiple product approvals and is set to disclose significant clinical data, with its first domestic TROP2 ADC expected to lead clinical iterations [3][11]. - Merck's continued investment overseas indicates the emerging potential of the next-generation blockbuster products [11]. Financial Summary - Revenue projections for 2024-2026 have been adjusted to 1.732 billion, 1.670 billion, and 2.666 billion RMB respectively, reflecting a slight decrease in 2025 expectations [11]. - The company reported a revenue increase from 804 million RMB in 2022 to 1.540 billion RMB in 2023, representing a 91.6% growth [7]. - The gross profit is expected to rise from 759 million RMB in 2023 to 1.103 billion RMB in 2024 [7]. Product Development - The core product, Lukanasatuzumab, was approved for market release in November 2024, targeting second-line and above triple-negative breast cancer (TNBC) [11]. - Additional indications for Lukanasatuzumab are in the NDA stage, with approvals anticipated in 2025 for 3L EGFRm NSCLC and 2L EGFRm NSCLC [11]. - Other products, including Tagolizumab and biosimilars, are also set for approval in early 2025 [11]. Clinical Trials - The company is expected to disclose critical clinical data from ongoing trials, including registration trials for Lukanasatuzumab in various indications [11]. - Merck has initiated 12 key clinical trials for Lukanasatuzumab, indicating its importance in the oncology field [11].

Investment Rating - The report maintains a "Buy" rating for Kelun-Biotech (6990 HK) with a target price of HKD 252 8, representing a potential upside of 48 8% from the latest closing price of HKD 169 9 [3][7] Core Views - Kelun-Biotech has entered a new commercialization phase with the approval of two key self-developed products: sac-TMT (Jiatailai®), the first domestically developed TROP2 ADC for TNBC, and KL-A167 (Ketailai®), a PD-L1 monoclonal antibody for nasopharyngeal carcinoma [1] - Sac-TMT has a strong competitive moat with multiple indications in breast and lung cancers, including approved use for TNBC and NDA submission for EGFRmt NSCLC, with 4 breakthrough therapy designations in China [2] - The company has a robust clinical pipeline with HER2 ADC A166 and cetuximab A140 under NDA review, and 5 other ADCs in Phase 1 trials, demonstrating its R&D platform strength [2][6] - A mature commercialization team of ~400 people has been established to support product launches [2] Financial Projections - Revenue is forecasted to grow from RMB 1 603 billion in 2024 to RMB 2 889 billion in 2026, representing a CAGR of 34 2% [7] - Gross margin is expected to improve significantly from 49 28% in 2023 to 92% in 2026 [9] - The company is projected to turn profitable in 2026 with net income of -RMB 121 41 million, improving from -RMB 574 13 million in 2023 [9] Valuation - The DCF valuation stands at RMB 49 12 billion, implying a target price of RMB 234 1 (HKD 252 8) [7] - The stock trades at -111 94x 2024E P/E and 19 26x 2024E P/B [9]

Investment Rating - The report assigns an "Accumulate" rating for the company, marking it as the first coverage [1]. Core Viewpoints - The company has a strong ADC platform technology and its core product, TROP2 ADC, has been approved for market [1]. - The company has established a comprehensive ADC research and development platform, OptiDC, which supports the entire development process from research to production [1][13]. - The company has multiple products in clinical development, with significant partnerships and collaborations enhancing its commercial prospects [1][3]. Summary by Sections Company Overview - Sichuan Kelun-Botai Biopharmaceutical Co., Ltd. focuses on innovative biopharmaceuticals and has established three core platforms for ADC, large molecules, and small molecules [13][21]. - The company has a strong management team with extensive industry experience and a concentrated shareholding structure [15][19]. ADC Development - The ADC market is projected to grow significantly, with the global market expected to reach $63.8 billion by 2030, and the Chinese market projected to reach RMB 68.9 billion by 2030 [54]. - The company has five ADCs in clinical research, with A166 (HER2-ADC) and SKB264 (TROP2-ADC) already in the NDA stage [59][60]. Product Pipeline - The company has four NDA applications accepted by the CDE, including A167 (PD-L1 monoclonal antibody), A166 (HER2 ADC), A140 (biosimilar of cetuximab), and SKB264 (TROP2 ADC) [2]. - The company has established a strong pipeline with over ten clinical candidates, including several in critical trials or NDA registration stages [21]. Financial Projections - The company is expected to generate revenues of RMB 1.217 billion, RMB 1.654 billion, and RMB 2.476 billion for the years 2024, 2025, and 2026, respectively, with net profits projected to be -RMB 720 million, -RMB 606 million, and -RMB 415 million [3].

Investment Rating - The investment rating for the company is "Buy" with a current price of HKD 196.00 and a reasonable value of HKD 205.82 [2]. Core Views - The report highlights that the approval of SKB264 as the first domestically developed original drug for treating advanced or metastatic triple-negative breast cancer (TNBC) marks a significant milestone in the company's development process [2]. - The company is expected to achieve substantial revenue growth, with projected revenues of RMB 16.55 billion, RMB 18.06 billion, RMB 24.23 billion for the years 2024 to 2026 respectively [2]. - The report emphasizes the successful progress of the company's drug pipeline, particularly in the TROP2 ADC platform, which is anticipated to drive revenue growth [2]. Summary by Sections Company Overview - The company has made significant advancements in its drug development pipeline, particularly with SKB264, which has received approval for treating advanced or metastatic TNBC [2]. - The report notes that the company has successfully submitted two New Drug Applications (NDA) for EGFR-TKI in China, indicating a strong domestic market presence [2]. Financial Projections - Revenue for 2022 was RMB 804 million, with a projected increase to RMB 1.54 billion in 2023, and further growth to RMB 1.655 billion and RMB 1.806 billion in 2024 and 2025 respectively [4]. - The report forecasts a significant growth rate of 2,387.3% in 2022, followed by 91.6% in 2023, and a more moderate growth rate of 7.4% in 2024 [4]. Profitability Metrics - The report indicates that the company is currently operating at a loss, with a projected net profit of -RMB 728 million in 2024 and -RMB 919 million in 2025 [4]. - The gross margin is expected to improve from 65.6% in 2022 to 71.3% by 2026, reflecting better operational efficiency [4]. Market Position - The company is positioned as a leader in the domestic TROP2 ADC market, with expectations for significant market share growth as new drugs are launched [2]. - The report suggests that the company’s innovative drug pipeline and successful clinical trials will enhance its competitive edge in the biopharmaceutical industry [2].

Investment Rating - The report maintains a "Buy" rating for the company [2][4]. Core Insights - The company's core product, TROP2 ADC, has received approval for use in treating adult patients with unresectable locally advanced or metastatic triple-negative breast cancer (TNBC) who have previously undergone at least two systemic treatments [2]. - The approval is based on positive results from the randomized, controlled Phase III OptiTROP-Breast01 study, which showed significant improvements in progression-free survival (PFS) and overall survival (OS) compared to chemotherapy [2]. - The company is advancing multiple indications for its products, with several new drug applications (NDAs) submitted and expected approvals for additional products between late 2024 and early 2025, marking the start of its commercialization process [2]. - Revenue projections for the company are estimated at 1.993 billion RMB in 2024, 2.026 billion RMB in 2025, and 3.085 billion RMB in 2026, with net losses expected to narrow over the same period [2]. Financial Summary - Revenue for 2023 is reported at 1.54 billion RMB, with a growth rate of 91.6% [7]. - The projected net profit for 2024 is -138 million RMB, improving to -618 million RMB in 2025, and -133 million RMB in 2026 [11]. - The earnings per share (EPS) is expected to improve from -2.58 RMB in 2023 to -0.60 RMB in 2026 [11]. - The company’s gross margin is projected to increase from 49.28% in 2023 to 74.05% in 2026, indicating improved profitability [11].